Practice Areas

Texas and Illinois Manufacturers Seek Authorization for FTZ Production Activity

Monday, December 30, 2013

Sandler, Travis & Rosenberg Trade Report

The Foreign-Trade Zones Board has received from the City of Conroe, Texas, grantee of FTZ 265, a notification of proposed production activity on behalf of Bauer Manufacturing Inc. Bauer already has authority to produce pile drivers and leads, boring machinery, foundation construction equipment, foundation casings, related parts and sub-assemblies, and tools and accessories for pile drivers and boring machinery within Site 1 of FTZ 265. The current request would add certain foreign-status components to the scope of authority.

Production under FTZ procedures could exempt Bauer from customs duty payments on the foreign status components used in export production. On its domestic sales, Bauer would be able to choose the duty rates during customs entry procedures that apply to pile drivers and leads, boring machinery, foundation construction equipment, foundation casings, and tools and accessories for pile drivers and boring machinery (free, 2.9%, 5.0%) for the foreign status inputs noted below and in the existing scope of authority. Customs duties also could possibly be deferred or reduced on foreign status production equipment. The components and materials sourced from abroad include zinc plated non-alloy steel, alloy steel bars, shapes of non-alloy semi-finished steel, and keys for control panel doors (duty rates range from free to 4.5%). Comments on this request are due by Feb. 10.

The FTZ Board is also seeking comments by Feb. 10 on a separate notification of proposed production activity submitted by the Illinois International Port District, grantee of FTZ 22, on behalf of Electrolux Home Care Products Inc. Located within Site 34, the Electrolux facility is used for the distribution and kitting of floor care and other small home appliances. FTZ activity would be limited to the specific foreign-status materials/components and specific finished products described in the submitted notification and subsequently authorized by the FTZ Board.